DEBT charities are bracing themselves for a flood of calls after Christmas as overstretched borrowers find they can no longer keep up with their repayments.
January is traditionally the busiest time of the year for groups such as National Debtline and the Consumer Credit Counselling Service (CCCS), and this year is expected to be worse than previous ones.
In January last year, calls to National Debtline more-than doubled, soaring to 26,532 – up from 10,546 in December.
The Consumer Credit Counselling Service also reported steep increases in demand, receiving 53% more calls for help during the month than it did on average each month between February and October this year, while volumes were also 53% higher than they had been in January last year.
Paul Mullins, chief executive of National Debtline, said: “The post- Christmas period is the busiest for the debt advice sector, as the expense of Christmas often tips many households into unmanageable debt.
“Many clients seek advice after the Christmas period once they have received their credit card statement in January/February.”
This year is expected to be particularly bad as household finances have also come under increasing pressure during 2007 from higher mortgage repayments, hikes in the cost of living and increasing petrol prices, while earnings have been falling in real terms.
At the same time, people may also find they are unable to get further credit as a result of the global credit crunch, meaning they can no longer rotate their debt.
Mullins urged people who did find themselves in difficulties to remember that free, impartial debt advice was available from the charity sector, and warned that debt management companies that are advertised in the media were not always able to offer their clients the full range of options which could be available to them.
Payments industry body Apacs estimates that Britons will spend £53bn during December this year, around £11.7bn of which will be put on to credit cards.
But survey evidence suggests many people struggle to clear this debt, with one in 10 people still trying to repay money they spent last year.
Debt charities have already experienced a big increase in people coming to them for help.
Citizens Advice said a record number of people contacted it for help with unmanageable debt, right, during the year to March, 2007, with the group handling 1.7m cases – a 20% jump compared to the previous year.
A spokeswoman said: “Debt is an all-year-round problem, but every year we see a huge increase in debt problems immediately after the Christmas period.”
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